Tech stocks slide as data-center debt worries hit AI trades

Technology stocks fell sharply Thursday as credit markets wobbled and bonds rebounded, with massive bets on data centers and AI infrastructure strained by high and rising interest rates. The MSCI Asia-Pacific index outside Japan dropped 3.4%, led by an 8% fall in South Korea's KOSPI. Wall Street stocks fell for a third day after US consumer price inflation accelerated more than expected in September. AI-related shares like Oracle and CoreWeave were hit by higher borrowing costs, while Asian hardware suppliers including Samsung Electronics and SK Hynix plunged. Credit default swap costs for AI giants rose to record levels. Despite the selloff, TSMC reported a 69% rise in third-quarter net profit, beating expectations. Some strategists remained optimistic, noting low volumes and no recession signs. Traders now see a 75% chance the Federal Reserve holds rates at its October 28 meeting.